It’s been an intense few months for Spirit AeroSystems CEO Larry Lawson, who joined the company in April 2013.
“I’ve had my head down for the last 10 months,” Lawson said.
“We were undergoing a strategic review, which we just wrapped up. Thank goodness. I gained 10 pounds,” he quipped.
Lawson and his wife moved to Wichita from Texas, where he served as a senior executive at Lockheed Martin.
Lawson was the keynote speaker Tuesday at the Wichita Aero Club’s luncheon at the DoubleTree by Hilton Hotel at the Wichita Airport.
Spirit is unique because the cost of its products, including the engineering and manufacturing costs, are attractive when compared to its competitors, which are the prime contractors themselves, he said.
The company employs 10,800 locally with a payroll of $870 million. It spends $664 million a year with about 360 Kansas suppliers.
Its 10 largest Kansas suppliers are Alcoa, Atlas Aerospace, Brittain Machine, Cox Machine, Ducommun Aerostructures, Exacta Aerospace, FMI, GKN Aerospace Precision Machining, TECT Aerospace in Wellington and Valent Aerostructures.
Eighty percent of Spirit’s business is on large, mature programs for Boeing and Airbus. The remaining 20 percent is derived from new development programs, Lawson said.
“We’ve been digesting those,” he said.
The company’s biggest challenge has been in the new programs. “We’re trying to reduce the investment piece and improve the financials,” Lawson said.
Although some of the new programs have been a struggle, they’re done with good quality and at low costs, he said.
Spirit has been working to bring up production rates to meet Boeing’s record production schedules.
Production will reach the increased rate of 42 737s a month later in February.
Spirit builds the 737’s fuselage in Wichita.
Building at those record rates makes for a fast-moving factory.
“It’s moving a lot of metal,” he said. “It’s bucking rivets and a lot of robotics.”
Spirit hired 500 people last summer to help get to the increased rate.
It’s still hiring, but at a more modest rate, Lawson said after his speech.
“We try to work our costs; we have to work our overhead at the same time that we’re addressing higher rates,” Lawson said. “You go out to our World War II factory and see our investments in the infrastructure.”
There are modern robotics on a large scale helping take production to the next level, he said.
Spirit also is working with composites as it builds the forward fuselage to Boeing’s 787 Dreamliner.
It starts with a quarter inch of carbon fiber wound on a mandrel, Lawson said.
Boeing’s specially modified 747, the Dreamlifter, flies to Wichita to pick up the 787 sections and then takes them to Everett, Wash., for assembly.
Spirit was recently recognized by Boeing as a top performer on the program because of its on-time record, Lawson said.
Long-term, growth in the commercial aviation market is a lift for Spirit.
Boeing currently has a seven-year backlog of commercial airline orders.
The long cycle in commercial aviation attracts investors, Lawson said.
Spirit also is fortunate to be on defense programs, such as the forward section for the KC-46 tanker for the Air Force, the P-8A for the Navy and the Sikorsky CH-53K for the Marine Corps.
It also recently entered into an agreement with Bell Helicopter to build the fuselage on a prototype V-280 helicopter for the Army.
“It’s an exciting program,” Lawson said.